Where Will 78 Million Boomers Retire? Facing the Challenge of Aging in Place

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With roughly 78 million baby boomers at or near retirement and average life expectancies climbing, many independent-minded seniors are resisting the pressure to move to often costly retirement communities or assisted living facilities and are instead making plans to stay at home.

“Aging in place” is the new mantra for many older Americans and there has been a surge in community-based programs and activities to help them remain in their homes. Indeed, the rate of homeownership among people 65 and older is a remarkable 78.5 percent, compared with a homeownership rate of 63.5 percent among the general population. And that isn’t likely to change anytime soon.

The challenge for many to both stay relatively healthy and hang onto their homes is formidable. An estimated 80 percent of seniors in the U.S have chronic health conditions that potentially could force them into nursing homes or assisted living without adequate health care support. And while 87 percent of seniors said in an AARP survey that their fondest desire is to remain in their homes and communities, depleted incomes and savings are making that harder and harder for many Americans.

So what to do?

A new report by a task force of the Bipartisan Policy Center released on Thursday is calling for a “more strategic approach” to linking health care and housing policies to help millions of seniors realize their desire to stay put in their homes as long as possible.

The report is highly critical of federal, state and local health care and housing officials operating in isolation from each other and calls for a more collaborative effort.

“By more tightly linking health care and housing policy, the U.S. has the potential to improve the health outcomes for seniors, reduce the costs incurred by the health care system, enable millions of seniors to 'age in place' in their own homes, and improve their quality of life,” Vin Weber, a former Republican House member from Minnesota and co-chair of BPC’s Health and Housing Task Force, said in a statement. “Making these connections is critical as federal government spending on Medicare, Medicaid, and other health programs is projected to grow much faster than the overall economy over the next 25 years.”

The task force stressed the urgency of the government and private sector moving quickly to develop new ideas and programs for helping baby boomers as they reach senior status. By 2030, more than one in every five Americans will be 65 or older, compared to 13.1 percent in 2010 and 9.8 percent in 1970. In short, in a span of just 60 years the percentage of the population over the age of 65 will more than double.

According to recent Congressional Budget Office study, population aging over the next quarter of a century will be responsible for 56 percent of the growth in spending on major federal health programs. Enrollment in Medicare, the costly program providing health care for seniors, is expected to increase by 16 million people annually. That will lead to a total of nearly 81 million beneficiaries by 2070.

With CBO budget projections showing that mounting Medicare and Social Security costs will greatly add to the deficit over the coming decades, task force members argue that a coordinated effort to help keep seniors both healthy and in their homes may be a critical tool for slowing the growth of the deficit.

On the health care front, seniors with chronic conditions like heart disease, kidney problems, respiratory ailments and obesity utilize high volumes of complex health care services – roughly 84 percent of U.S. health care dollars and 99 percent of Medicare spending, according to the report.

As the population of retirees steadily rises and more seniors try to remain in their homes, there will be increased demand for community-based services, such as transportation to and from doctors’ offices, help in doing household chores, exercise classes and counseling to treat the symptoms of social and emotional isolation.

On the housing front, many seniors – facing diminishing income and personal savings -- will need financial assistance in making their mortgage and rental payments.Most seniors will be homeowners, though the number of senior renters will increase dramatically, according to the study. However, many of them will struggle to find affordable housing and will need federal rental assistance.

What’s more, the report notes, “Older seniors are carrying larger mortgage balances into their retirement years, potentially impacting their ability to finance retirement and aging-in-place needs.”

The task force, which includes former Department of Housing and Urban Development secretaries Henry Cisneros and Mel Martinez and former Democratic House member Allyson Schwartz from Pennsylvania, is working to identify cost-effective ways to enable seniors to live more independently and safer. They will also seek ways of increasing the supply of affordable housing for seniors.

The good news in the report is that there already are many community-based programs throughout the country that have “successfully integrated” housing and health care for seniors.

Stewards of Affordable Housing for the Future, a network of 11 nonprofit organizations that support and provide affordable rental housing for 115,000 low-income seniors and families in 49 states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands. The organization has demonstrated how housing providers “can work more effectively with the health care system, including with accountable care organizations and managed care entities,” according to the study.

Vermont’s Senior and Services at Home program, which is operated by the housing provider Cathedral Square. The program is touted for having shown how closely linking the operation of housing and supportive services for seniors can slow the rate of growth of Medicare spending.

A handful of housing providers including National Church Residences and Mercy Housing “are proving that housing can be an essential platform for the delivery of health care and other services,” according to the report.

Medicaid Home and Community-Based Services waivers also enable low-income seniors to receive assistance in their own homes and communities rather than having to move into more expensive institutional facilities. A few states are also using Medicaid funds to provide housing-related services to help individuals move out of more costly nursing homes and back into their communities.

“These are all positive developments,” the report states. “But with millions of Americans about to enter the senior ranks, the current window of opportunity is small and narrowing. Strengthening the collaborative bonds between health and housing must become an urgent national priority as we prepare for the demographic changes ahead.”

Washington Editor and D.C. Bureau Chief Eric Pianin is a veteran journalist who has covered the federal government, congressional budget and tax issues, and national politics. He spent over 25 years at The Washington Post.